Gold’s Key Breakout Level: Above $1,360, Little Resistance to $1,700+

Dating back to 2013, gold has run up on the $1,360 level on to retreat, consolidate, and take another shot at a breakthrough. We’re verging on a seventh attempt, and with innumerable potential catalysts for a flight to safety and a historically overextended stock market, the setup couldn’t be more bullish.

The gold rally is expected to continue with prices for the precious metal likely to grow in the near term, predicts publisher of the Bear Traps Report, Larry McDonald.

After last week's surge, the gold market extended gains on Monday to reach its highest level in five weeks before retreating slightly over the last two days. McDonald told CNBC that the rally can go on, as the "perfect storm" of rising gold prices is coming up. Gold has rallied more than 3.5 percent this year.

Another analyst, Chief Executive Officer of US Global Investors Frank Holmes, has said that gold is heading to $1,500 this year from the current $1,340-$1,350 levels.

“Inflation could be growing a lot faster than what the government is telling us. No matter which gauge you look at... inflation is trending up,” he told Marketwatch. Gold is often used as a hedge against inflation.

A weaker dollar would also contribute to gold prices, according to Holmes. “Americans like to hear that the dollar is strong, but a weak dollar makes American exports and tourism rock, not to mention gold prices go up,” he said.